Audit 399382

Criteria: The Organization is required to inform tenants, through written notice, of their responsibility to provide information needed to complete recertification process and copies of these notices should be maintained in the tenant files, along with required supporting documentation. Statement of Condition: The Organization did not maintain copies of notices of recertification or all supporting documentation, such as the EIV reports, in the tenant files. In one of the files reviewed, there was no supporting documentation for the social security income amount used to calculate the tenants payment. Cause of condition: The Organization did not pursue tenant compliance with annual recertification process after initial notice of recertification provided upon completion of prior recertification. Effect of condition: There is no evidence of a tenant’s eligibility for rent assistance maintained by the Organization in the tenant file. Recommendation: The design of the current controls should be reviewed to ensure tenants receive proper notice of the annual recertification process and that all documents related to recertification are acquired. Additionally, tenant files should be reviewed to ensure all supporting documentation is included. Views of Responsible Officials: Management agrees with the finding and will implement procedures to ensure tenant recertifications are documented in accordance with HUD guidelines and that proper documentation is maintained within the tenant files.

Criteria: The Organization is required to hold all tenant security deposits in a separate interest bearing account. Statement of Condition: The Organization withdrew funds from the security deposit account in the current year, leaving the amount of cash in the security deposit account lower than the total liability for current tenants’ security deposits. Cause of condition: The Organization does not keep an active listing to track the payment of tenant deposits and allocated interest earned on account. Effect of condition: Security deposit bank account is underfunded. Recommendation: The design of the current controls should be reviewed to ensure all tenant security deposits are properly tracked. Management should make transfers to the security deposit account to cover all deposits currently on hand. Views of Responsible Officials: Management agrees with the finding and will implement procedures to ensure proper tracking of security deposits and will make the necessary transfer to fund the security deposit account.